Germany in Political Limbo After Inconclusive Election

Germany finds itself in political limbo after Sunday's general election failed to give any party a clear overall majority. It now faces days and, possibly, weeks, of uncertainty as the country's two major parties search for possible coalition partners.

Both Angela Merkel, the leader of the opposition Christian Democrats, and Social Democratic Chancellor Gerhard Schroeder say they have a mandate to lead Germany's next government.

Provisional official results gave the Christian Democrats 35 percent of the vote to the Social Democrats' 34 percent. That translates into 225 seats in parliament for Ms. Merkel's alliance and 222 seats for Mr. Schroeder's party.

Even if Ms. Merkel were to form a coalition with the Christian Democrats' traditional partners, the pro-business Free Democrats, she would not have enough of a majority to govern effectively.

Mr. Schroeder has the same problem if he were to form a coalition with his traditional partners, the Greens.

So both leaders must now try to reach out to other parties. But even though Ms. Merkel will get the first shot at trying to form a government, Social Democratic Economy Minister Wolfgang Clement insists his party would only join a coalition with the Christian Democrats if Mr. Schroeder is chancellor.

"We will negotiate with the others, but the chancellor is Gerhard Schroeder, and we want him to be the chancellor in the future, too," he said.

The Social Democrats, who were 20 points behind the Christian Democrats in the polls when the campaign began, say they are the real winners of the election, but one German newspaper described the situation as a struggle for power between two losers claiming victory.

As the parties met to work out coalition scenarios, it was anybody's guess what kind of government would eventually emerge. Noah So, a pop singer in Berlin, says nobody could have foreseen such political disarray.

"I think nobody knows right now who is going to form a coalition. It is pretty much a thriller," she said.

But if Miss So and other Germans waited for the results of backroom negotiations, investors reacted to the political uncertainty by dumping their euros on world markets. Prices on the Frankfurt stock exchange also fell in early trading.

John Ryan, a professor at the European Business School in London, says the inconclusive results of the election will hurt Germany's economy.

"Five million unemployed German people are not going to be happy about this result to a certain extent because all I can see is that there's going to be a stall in the economy… and I can see a continuing outsourcing out of the country of jobs into other parts of the world," he said.

At European Union headquarters in Brussels, there is a pervasive fear that political limbo in the bloc's biggest member will stymie efforts to kick-start Europe's stagnant economy.

The new German parliament must be sworn in on October 18. But if no coalition emerges before then, there might have to be new elections.